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Vips wrote:Babudom hard at work to ensure their livelihoods or else they know they will go the Air India/BSNL way.

If they under bid and there is price escalation the GOI will cover it so they have nothing to lose unlike Private SY.

this "obligation" to support private players is a misguided myth.

private players are often very shy in making capital investments but are always whining for huge contracts so that "they can make capital investments". Their services, as well as products, are untried and untested so the system is wary of taking a chance with them.

Look at what happened to pipav and some of the others. It was the predominantly bad assessment of technologies bought from fly by night gora/other companies at some cut rate price plus their unwillingness to correct mistakes which sank them.

They had all entered just to make a killing but instead got killed themselves because they simply did not understand the risks or knowing the risks, decided to ignore them and paid the price.

Industries often open just to take advantage of some forthcoming orders so their motivation is just hit and run. This is not a sustainable business model and also key players are not adequately compensated by the lalas who expect to pay mere peanuts but insist on making millions in profits. This may work if you are selling potatoes but not when making and selling lifecycle based weapon systems.

Guarantee servicing and lifetime support can mean staying in business reliably for a 20-30 year period, all the while churning out spares and other subassemblies.

If one doesn't have deep pockets, it is better not to venture too deep into the MIC space.

chetak wrote:If one doesn't have deep pockets, it is better not to venture too deep into the MIC space.

Yep, the Navy, despite having the best indigenous-mindsets among services, stumbled in nurturing private-sector shipbuilding - they did not bank on the medium size firms not having immense capital reserves till commissioning a ship!

Even L&T was left gasping for air and Kattupalli had to be sold off hastily to Adanis. Less said of Pipavav, Alcock Ashdown (Makar class rusting hulks ), the better. If the industry has to grow organically it would need some very solid civilian shipbuilding orderbook like the So Koreans and Japanese. Or even the chinese. Else it will need to be in the fold of a deep pocketed Adani or Ambani. If none of these are available, it is back to sub-contracting, like what L&T has gone back to or smaller scale ones like ABG's interceptor assembly etc.

It is a bit of a pain that all capital naval assets are ginormous engineering and financial hogs, compared to a lot of army or airforce assets

chetak wrote:If one doesn't have deep pockets, it is better not to venture too deep into the MIC space.

Yep, the Navy, despite having the best indigenous-mindsets among services, stumbled in nurturing private-sector shipbuilding - they did not bank on the medium size firms not having immense capital reserves till commissioning a ship!

Even L&T was left gasping for air and Kattupalli had to be sold off hastily to Adanis. Less said of Pipavav, Alcock Ashdown (Makar class rusting hulks ), the better. If the industry has to grow organically it would need some very solid civilian shipbuilding orderbook like the So Koreans and Japanese. Or even the chinese. Else it will need to be in the fold of a deep pocketed Adani or Ambani. If none of these are available, it is back to sub-contracting, like what L&T has gone back to or smaller scale ones like ABG's interceptor assembly etc.

It is a bit of a pain that all capital naval assets are ginormous engineering and financial hogs, compared to a lot of army or airforce assets

some of the same guys who messed up in the shipbuilding space also cut and ran from the dilli metro fiasco, abandoning the project midway.

such players are never to be encouraged ever again but due to their constant machinations, they keep popping up every now and again in different avatars.

John wrote:If they under bid and there is price escalation the GOI will cover it so they have nothing to lose unlike Private SY.

this "obligation" to support private players is a misguided myth.

private players are often very shy in making capital investments but are always whining for huge contracts so that "they can make capital investments". Their services, as well as products, are untried and untested so the system is wary of taking a chance with them.

Look at what happened to pipav and some of the others. It was the predominantly bad assessment of technologies bought from fly by night gora/other companies at some cut rate price plus their unwillingness to correct mistakes which sank them.

But Chetak ji, a way to include private players must be made or we would eventually go the way of the soviets. The reason MII is in place is because the PSU cannot do the job to the extent befitting our size and ambitions.

That is not to say the what CSL, GRSE and MDL had done for the navy was not exemplary. Not many nations can produce 7K tons destroyers or 40K tons carriers. Bit where we want to go, we cannot afford to wait 10 years to commission a warship.

How can you pressure institutions who are guaranteed money at the till unless you bring in the private sector? And how can you make that private sector survive unless you provide that large initial contract?

There must be some support to the private ventures in the beginning in the form of longer stable contracts which, yes, would allow them to make that large initial capital investment.

chetak wrote:this "obligation" to support private players is a misguided myth.

private players are often very shy in making capital investments but are always whining for huge contracts so that "they can make capital investments". Their services, as well as products, are untried and untested so the system is wary of taking a chance with them.

Look at what happened to pipav and some of the others. It was the predominantly bad assessment of technologies bought from fly by night gora/other companies at some cut rate price plus their unwillingness to correct mistakes which sank them.

But Chetak ji, a way to include private players must be made or we would eventually go the way of the soviets. The reason MII is in place is because the PSU cannot do the job to the extent befitting our size and ambitions.

That is not to say the what CSL, GRSE and MDL had done for the navy was not exemplary. Not many nations can produce 7K tons destroyers or 40K tons carriers. Bit where we want to go, we cannot afford to wait 10 years to commission a warship.

How can you pressure institutions who are guaranteed money at the till unless you bring in the private sector? And how can you make that private sector survive unless you provide that large initial contract?

There must be some support to the private ventures in the beginning in the form of longer stable contracts which, yes, would allow them to make that large initial capital investment.

My opinion, Sir.

chola saar,

rework the agreements with the PSUs, scrap the guaranteed cost plus 10% formula and shed the bloated and unionized staff.

Disinvest to the tune of 51 percent and let them loose to either sink or swim.

let them compete for orders without preferences marring the bid process.

no more nonsense about "who will take care of my family". Thousands upon thousands of private sector employees simply find alternate work when their firms are downsized or the employees are otherwise found redundant.

for the unorganized sector, MSMEs and others, layoffs are a daily feature of their lives when the lala tells them not to come from tomorrow because he did not get some anticipated order.

You really do not need more than 50% of the aviation PSU staff. They are mere passengers who are both a financial as well as a productivity burden on the organization because their average productivity is less than three hours a week. For this output, they consume enormously expensive company resources in terms of unwarranted benefits, needless infrastructure, and management effort.

We, the long suffering Indian public, pay for all this through the taxes levied on us.

this was a soviet era model that was long ago junked by the soviets themselves. lenin and marx are apparently alive and well in India.

wherever one sees, it is the same, look at the railways, air India, coal India, anything India and ultimately all put together it becomes screwed India and special interest groups like the miniscule organized sector always demands and grabs much more than their pound of flesh.

Just like air India is doing right now and has been doing for many years. Every employee, retired and currently working, is drawing their full medical benefits which on an average may run into many lakhs per year for the retired guys and maybe about a lakh + for the serving guys. This free for all includes parents and "dependants" who never age beyond 12 years on paper but in reality, are often married with college going kids. This is just one small aspect of the massive and unseen bottom of the ginormous PSU iceberg.

Stop pampering the PSUs and let the private players compete on an equal footing provided they have demonstrated competencies, financial muscle, plant/machinery/tooling, and the technical expertise to complete the contract.

one way forward maybe, is to form private consortiums with a few private players getting together and bidding jointly for big contracts on a work share basis.

If you start to pamper and "support" the private players in the manner that they are demanding, you are simply creating a parallel set of privately owned PSUs who will become another huge burden and drain on the Indian taxpayer.

One joker abandoned the dilli metro halfway through. What will you do if another joker abandons four kolkata class destroyers halfway through the build and settles down in better climes next to vijay mallaya or nirav modi

Rakesh wrote:https://twitter.com/delhidefence/status/1122883677690589184 ---> GRSE, Kolkata has received an order worth Rs 6311.32 crores for building 8 Anti-Submarine Warfare Shallow Water Craft for the Indian Navy. The 1st ship is to be delivered within 42 months of contract signature. Each ship has a deep displacement of 750 tons and 25 knots max speed.

John wrote:Every large naval procurement has gone over budget, most often 2x the original contract. Not sure how this will be any different?

Once again, which fixed price contracts have gone over budget? You're probably thinking of cost-plus contracts, which by their very nature have no fixed price. MoD estimates of cost-plus contracts are just that, only used for the purpose of budgeting.

chetak wrote:If you start to pamper and "support" the private players in the manner that they are demanding, you are simply creating a parallel set of privately owned PSUs who will become another huge burden and drain on the Indian taxpayer.

One joker abandoned the dilli metro halfway through. What will you do if another joker abandons four kolkata class destroyers halfway through the build and settles down in better climes next to vijay mallaya or nirav modi

Totally agree, Chetak ji. We cannot support another set of PSUs by another name. I understand your point.

That said ...

Just like air India is doing right now and has been doing for many years. Every employee, retired and currently working, is drawing their full medical benefits which on an average may run into many lakhs per year for the retired guys and maybe about a lakh + for the serving guys. This free for all includes parents and "dependants" who never age beyond 12 years on paper but in reality, are often married with college going kids. This is just one small aspect of the massive and unseen bottom of the ginormous PSU iceberg.

I appreciate how you always provide an anecdote to make one's blood boil about the situation! But Air India brings up the reason why I think it is more realistic to support the private sector with stable contracts.

Yes, in the perfect world I would prefer your idea of divesting 51% of the PSUs and leveling the playing field. But how long have we talked about this very idea with Air India? How many potentially profitable routes has it squatted on and deprived legitimate companies while DDM debated for a decade and half now about removing unfair and distorting government support for an entity in an industry that has good players in the private sector?

If we cannot give up a PSU in the airliners industry then ot is well neigh impossible in the defense industry where there are few private players of note. I understand that you need deep pockets in the MIC. But you know as well as I that it is the same in air travel. Yet we have private sector leaders there. There difference is the customers in aviation are not all government entities unlike the MIC.

That is why the GOI must support a legitimate private sector element with stable contracts at least initially. Because of the vested interest, I can't see any Indian leader -- and Modi is the most powerful one in recent memory -- being able to divest from the PSUs. But I do think the GOI can support a few private sector players to force some competition and change in the ginormous PSU iceberg.

India has ordered four Project 11356 stealth guided missile frigates from Russia. Out of which two will be constructed in India at GSL for which Russia is providing the technical support.

As per the contract, Russia is expected to provide the two ships minus the Brahmos missiles - which will be fitted in India at GSL, and the Ukrainian Zorya-Mashproekt manufactured DS-71 engine, for which India has signed a separate contract with Ukraine.

There are too many factors and too many problems in most major industrial sectors in India, where both PSU and private players exist.Specifically for the shipping Industry, the failure of all the private companies are different.

ABG failed due to a combination of cancellation of large number of civilian ship building orders post 2009 and also the management diverting funds and trying to diversify into unrelated sectors like Cement and flameproof electric motor manufacturing etc. Also, the over leveraged balance sheet came calling. The aggressive expansion carried out at Dahej and buyouts like Western India shipyard etc., proved too much for the company to handle.

Alcock Ashdown is a Gujarat Government owned company. They got sunk, because they bid for the Navy project, well below cost and with the state government not bailing them out of their stupidity, there is no way the company can execute the order. Many times the PSUs indulge in these kind of tactics as well. They put in really low bids, when there is competition, knowing that the private sector will not be able to compete with their low price and they can always rely on government support to bail them out or simply report a loss. The Alcock Ashdown tender and contract had taken place at MDL in Mumbai and they got suckered into bidding a really low price.

With Pipavav/Reliance, it is unfortunate that unworthy management like Nikhil Gandhi and later Anil Ambani have come to own the best available infrastructure for ship building in India. Pipavav got a lot of orders for civilian ships, without having the requisite technical knowhow and the management simply looking to sell the company and make a lot of money. From Punj Lloyd to Mitsubishi to some Korean companies, they tried to sell Pipavav to anyone who would be interested. All this while the management was just finding ways of getting money from one source or another to stay afloat. Finally they sold to Anil Ambani, who proved to just as adapt as the previous management. Though at the same time, there are at times difficulties created by the services as well. They just tend to hold any Indian vendors to a much higher standard then they even dream of doing with foreign vendors. For Pipavav/reliance, my company is supplying a certain type of valves for the ships. For the navy OPV order, they have ordered the valves to be from S.S. 304, instead of the standard mild steel construction. We have been manufacturing these valves since 1970 and have supplied for many Navy projects over the years, from the Nilgiri class to the latest P15B. Only once in all these years, we have supply valves made from S.S., that too a very small quantity and not for a naval project. For all Navy or ICG OPVs built at GSL or L&T, we have supplied the valves and all made from mild steel only. Ditto for P17, P15B (currently on-going) etc. I have no idea, why Navy had demanded that the valves on the Pipavav/Reliance built NOPVs should be from S.S. 304. The cost increases by almost 5 times. Unfortunately for my company, we supplied for the first 2 ships and were paid advance along with the P.O. and full payment before delivery (these were our terms). We received the follow on order for the balance 3 ships and diligently we produced the material without waiting for the advance. Now, I am sitting on 35 Lakhs worth of material, ready for delivery since 2 years, with the customer nowhere in sight. All the purchase folks and anyone else that we had contact with for the project has either left the company or is doing something else. Don't know whether the project will go forward or not. In the worst case, will have to offer S.S. valves at the price of MS to some other customer or sell the material for scrap after a few years.

PSU's like AI and MTNL have suffered badly due to their bloated, overpaid and underperforming work force and also due to the government screwing them over, to benefit some crony private players. AI lost a lot of profitable routes to benefit the likes of Jet and middle eastern carriers, not to mention to the decision by Praful Patel to buy more then double the number of aircraft required, which the company could not afford. MTNL's cellular service in Mumbai was delayed by a year, just to help out some private players and then subsequently, their 3G service was also delayed by 1 year, to completely kill the company. Obviously the workforce of MTNL remains one of the biggest problems and the only solution would be sell the company for its physical infrastructure within the next 12 months. Beyond that, even the value of the infra will much reduced.

From the above list - and as you have indicated above - only the Rafale M and the F-18 Super Hornet have any chance of winning the contest. The other two are just there for eye candy - the Naval Gripen E does not even exist! This news article however is just basically stating the the MiG-29K will be pitted against the Rafale M in the upcoming Indo-French Naval Exercises. This is a good opportunity for Indian Naval pilots to gauge the Rafale M against the MiG-29K and see all the shortcomings of the latter. The same was done last year when the MiG-29Ks were pitted against the F-18 Super Hornet.

There is nothing like real world experience against seasoned carrier operators like the US and France. This will help the Indian Navy in deciding - among other factos - which platform will be best suited.

John wrote:Every large naval procurement has gone over budget, most often 2x the original contract. Not sure how this will be any different?

Once again, which fixed price contracts have gone over budget? You're probably thinking of cost-plus contracts, which by their very nature have no fixed price. MoD estimates of cost-plus contracts are just that, only used for the purpose of budgeting.

Scorpene contract which I believe was fixed price that was signed in 2005 was 3.75 billion split between DCN and MDL. We all know the final figure far exceeded that.

From the above list - and as you have indicated above - only the Rafale M and the F-18 Super Hornet have any chance of winning the contest. The other two are just there for eye candy - the Naval Gripen E does not even exist! This news article however is just basically stating the the MiG-29K will be pitted against the Rafale M in the upcoming Indo-French Naval Exercises. This is a good opportunity for Indian Naval pilots to gauge the Rafale M against the MiG-29K and see all the shortcomings of the latter. The same was done last year when the MiG-29Ks were pitted against the F-18 Super Hornet.

There is nothing like real world experience against seasoned carrier operators like the US and France. This will help the Indian Navy in deciding - among other factos - which platform will be best suited.

The forecasted need for IN fighters is about 60 planes for the CBGs.i just saw that Trump ordered 24 F-18s for $2B.So 60 planes would be 60*(2.0/24) = 2+2+1 = $5B.F-18 has the same engine as for Tejas MWF.

So some deal where GE sets up engine factors for the engine on a Govt to Govt basis could be negotiated.At same time I don't know what Rafale M unit price is.

And already Safran is on board to offset Kaveri engine factory.The advantage is commonality with the IAF Rafale And Rafale follow-on could take on India as a partner.So its really a battle between the two Western aircraft mfg nations.

If the US ordered 24 F18's for USD 5 billion we can safely assume it will be double the price for India per aircraft, infrastructure training fresh weaponary etc. Thats been the case C17 P8. C130 Apache Chinook Harpoon etc. So thats at least 12-14 billion for 60 aircraft. Rafale M would be costlier.

John wrote:Scorpene contract which I believe was fixed price that was signed in 2005 was 3.75 billion split between DCN and MDL. We all know the final figure far exceeded that.

That price escalation was entirely due to the French pulling a fast one on us. They hid the true cost of the submarine by omitting several important components required for the local build. This led to additional demand of money from MDL to buy the required equipment, which led to protracted negotiations to arrive on a price, which led to delays that added to the total cost. MDL is hardly responsible for MoD's naivete/incompetence.

On May 6, a glorious era of INS Ranjit as the frontline missile destroyer of the Indian Navy will come to an end. INS Ranjit, the third of the five Kashin-class destroyers built by erstwhile USSR was commissioned in 1983 and has rendered yeoman service to the Indian Navy for over 36 years.

When we didn't have money for airforce mmrca, from where the money comes for Naval fighters?

Navy has to use NLCA until N-AMCA arrives. Why navy isn't pushing for work to start upon N-AMCA?

Bad decision USE-WISE: Spending 12 billion on imported Naval fighter will be bad decision USE-WISE. We need sophisticated fighter to fight over northwest to northeast borders with pori-panda borders. The 10 billion fighters in navy will have less airframe and engine life due to CONTROLLED-CRASH DECK LANDINGS.

NAVAL FIGHTERS WILL HAVE LESS LIFE DUE TO SEA-SALT CORROSION. BHARAT WILL GET LESS RETURN FOR ITS MONEY. We should divert that 12 billion towards 3 more squadrons for Airforce Rafale.

On May 6, a glorious era of INS Ranjit as the frontline missile destroyer of the Indian Navy will come to an end. INS Ranjit, the third of the five Kashin-class destroyers built by erstwhile USSR was commissioned in 1983 and has rendered yeoman service to the Indian Navy for over 36 years.

So the INS Rana will now be the only Rajput class left with the original weapons fit of 4 Styx missiles and the SA-N-1 Goa SAMs. I am always amazed by what the Navy managed to do with the upgraded ships, especially with the Ranvir and Raqnvijay. 8-cell Brahmos and 16-cell Barak on a ship that size is great. The larger Shivalik class has the same number of AShMs, although it has more SAMs.

"The Defence Ministry cleared the Rs 3,600 crore proposal for buying around 10 Kamov-31 Airborne Early Warning and Control choppers for the aircraft carrier operations and deployment on future warships," government sources told ANI.The decision was taken by the Defence Ministry at a meeting of the Defence Acquisition Council led by Defence Minister Nirmala Sitharaman.

The Navy already has a fleet of 12 of these Kamov-31 choppers which sanitise the air space around the aircraft carriers and destroyers operating in open seas.

the ranjit kashin glass was a bespoke soviet design with a unique underground hangar for its kamov helicopter. by removing this hangar i think space was excavated for brahmos UVLS. but one of this class has inclined brahmos tubes. said to be fastest ships in the IN.

but their days are gone and the P17 / Talwar class far more modern and well rounded.

the operating costs being a gas turbine engine and lots of complex bespoke soviet era eqpt will be too high.

the Saryu/Kamorta/P17 type vessels with clean modern gear and diesel or codag engines is more the type that vietnam could use efficiently.

these days large computer packed hulls, long range, sensors that can even track low flying satellites to distant sea skimmers and arrays of UVLS capable of holding many types using internal adapters is it.

a 127 or 76mm rapid fire gun armed with proximity fused shells for anti missile role. some horizon DDGs have 3 - which i really like.

Cheen has made a great leap if its UVLS works for n types of missiles. so far only the Mk41 was truly a zoo, with the Sylver only capable if funded - it was doing only aster15 and 30 last i checked though noises of naval scalp et al.

vietnam should imo focus on more submarines and ASW ships along with shore based 1000km SRBMs and GLCMs . cheen will swarm their limited surface capabilities quickly in any island conflict, subs will be more survivable.

there is a tug of war over vietnam between US and Cheen. they should ask for free P8 and refurbished P3. orange gorilla will surely give them.

Cheen is pumping $$ into vietnam and cambodia to rapidly bring them into its greater china eco zone and keep costs of manufacturing low for stuff thats now outpriced in shenzhen

Singha wrote:vietnam should imo focus on more submarines and ASW ships along with shore based 1000km SRBMs and GLCMs . cheen will swarm their limited surface capabilities quickly in any island conflict, subs will be more survivable.

there is a tug of war over vietnam between US and Cheen. they should ask for free P8 and refurbished P3. orange gorilla will surely give them.

China would shit bricks at the thought of Vietnam armed with SRBM/GLCM and P8/P3. If there is one country that has the will and spirit to take on China any day it is Vietnam. Had Vietnam access to technology or a Navy Like India, the chinese would have waived the white flag and guboed to them.

Singha wrote:there is a tug of war over vietnam between US and Cheen. they should ask for free P8 and refurbished P3. orange gorilla will surely give them.

Free P-8's? You've got to be kidding! Older stuff on the way to being decommissioned is one thing (P-3's) but there is not going to be any US administration that will propose handing its premier ASW platform to another operator for free at a time its own fleet growth is capped by budget constraints.

Singha wrote:vietnam should imo focus on more submarines and ASW ships along with shore based 1000km SRBMs and GLCMs . cheen will swarm their limited surface capabilities quickly in any island conflict, subs will be more survivable.

there is a tug of war over vietnam between US and Cheen. they should ask for free P8 and refurbished P3. orange gorilla will surely give them.

China would shit bricks at the thought of Vietnam armed with SRBM/GLCM and P8/P3. If there is one country that has the will and spirit to take on China any day it is Vietnam. Had Vietnam access to technology or a Navy Like India, the chinese would have waived the white flag and guboed to them.

what you can't beat ., buy ..and buy into their economy make them dependent and buy enough of their political and bureaucratic people who can influence state policies ., that art was perfected by ... the US, cheen is just following their guidebook